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According to the prospectus, they lose so much money because they are building out new locations. Their break even point takes about a year for an individual lo
by ryanackley 7y ago
According to the prospectus, they lose so much money because they are building out new locations. Their break even point takes about a year for an individual location.
So theoretically, they have a path to profitability. I just wonder where they get the cash in the meantime. >$1B/year burn rate, ouch.
- skinnymuch 7y agoWouldn’t it be from the IPO? If they sell 10% of the company, it should raise billions.
- empath75 7y agoThat sounds like a ponzi scheme, not an investment.
- blaser-waffle 7y agoThe only difference between those two concepts is malice.
- gizmodo59 7y agoIsn’t that like a trend these days? Unless I’m missing something, can you please explain?
- zaroth 7y agoI would never invest in WeWork, but no, not at all. A Ponzi scheme takes new investor dollars to pay the earlier investors’ “returns”. Taking new dollars to grow the company to generate future profits is actually the definition of “investment”.
- mffnbs 7y agoA ponzi scheme requires fraud. If you've evidence of fraud going on here then perhaps you should report it to the SEC.
- nickles 7y ago> I just wonder where they get the cash in the meantime. >$1B/year burn rate They're raising up to $6B in a debt offering.
- buboard 7y agoActually building or leasing?
- exothermic 7y agoAnd yet, their operating margin before any growth spend (or G&A) is a meager 20%. I suppose this has to do with relatively low average occupancy rates? I wasn't able to find occupancy rates on their existing locations in the S-1.
- vkou 7y agoI don't wonder that, cash in today's climate is easy to get. What I wonder is 'How spectacularly will their business implode if a recession starts?'